Detroit water board OKs plan to ease drainage fees

Christine Ferretti
The Detroit News

Detroit — The water department’s board on Wednesday signed off on a revised plan for a drainage charge program that will soften rate hikes some feared would be detrimental to Detroit churches and businesses.

The Detroit Water and Sewerage Department retooled the plan in partnership with Mayor Mike Duggan in the wake of complaints over increases in fees for some nonresidential customers as part of a uniform system for drainage billing.

The latest plan, approved by the Board of Water Commissioners, lowers the cost for commercial and faith-based customers to phase over time into the fee structure, which originally was set at $750 per impervious acre per month.

Brown, prior to the vote, told board members the move was spurred by complaints from businesses and churches that argued “we were severely impacting their ability to do business in the city of Detroit.”

“So we took a look at the program and decided to phase it in over five years, with the biggest change being instead our churches as well as commercial accounts coming onto the plan at $125 per impervious acre,” Brown said.

He added most commercial customers and churches are less than half an acre, so the average monthly bill at the start of the phase in will be closer to $62.50.

For churches, the new plan is expected to cut fees by 30 percent for those already paying $852 per impervious acre, per month. When churches come online July 1, 2018, they will see a dip to $598, officials said.

Churches paying a flat fee or nothing at all will be on a five-year phase-in plan for the new charges that begin July 1, 2018, at a rate of $125 per month per acre. Originally, the department had planned a three-year phase in.

The rate will climb annually before it finally reaches $677 per acre per month in 2022.

Board member Jane Garcia said after Wednesday’s meeting that beyond extending the timeline there’s not much more to be done since the costs have to be paid.

“The mayor has tried everything he can and met with the people and took the heat,” she said. “It’s a very bad time to roll this out. It’s election time, but you know what, doing the right thing is not always positive to people, but it’s the right thing.”

The water department will also allocate $5 million annually from its capital fund toward matching grants for eligible drainage improvements. It’s also laid out a variety of green infrastructure credits that officials say could eliminate drainage costs altogether for some customers down the line.

For most in Detroit, drainage costs have been included since 1975 as part of water and sewer bills. But the payments haven’t been equitable. Some were never charged, others were billed a flat fee based on water meter size, and the rest paid based on impervious acreage, or the developed portion of their property — the model to be used for all after the transition period.

Industrial customers began the fee transition in February, commercial is slated for this month and tax-exempt parcels will come online in June, officials said. In October, charges began for city-owned parcels and others never before billed.

Nonresidential customers already paying based on impervious acreage are to pay $750 per month. But under the changes, the rate will be reduced to $661 per acre this July and $598 per acre in July 2018.

If they are paying based on meter size or haven’t been billed before for drainage, they will begin by paying $125 per impervious acre per month when they transition, officials said.

At the end of five years, all nonresidential customers will be on the same rate, Brown said. Residential customers won't be affected at this time, he said.

Earlier this year, a group of religious institutions demanded Duggan renegotiate the fee plan, arguing it was “unholy.” Pastors of the Detroit Water Equity Coalition have praised the mayor for the changes but are still pushing for more.

The water coalition has argued Detroit is bearing the cost for drainage on its own and that it should instead be “common to all” in the regional agreement forged during Detroit's bankruptcy. The deal turned operation of its water and sewer system over to the Great Lakes Water Authority for 40 years.

Brown countered other communities in the authority are contributing their fair share to wet weather overflow costs.

The drainage fees, Brown has said, are also needed to aid Detroit in its handling of stormwater runoff and to meet regulations under the federal Clean Water Act. Officials say transporting and treating drainage costs the department more than $151 million annually.

By 2022, an environmental permit requires the water department to eliminate discharges of untreated water into the Detroit or Rouge rivers. If it doesn't meet the deadline, Detroit would be forced to spend another $1 billion to further build out the system.